Abstract

This thesis investigates human capital accumulation process for second generation immigrants and ethnic minority groups in both Canada and the U.S. A dynamic structural model is developed to respect the dynamic nature of the educational process. The model is then augmented to account for specific characteristics of different surveys used in the three essays.

The first essay focuses on educational attainment of children of immigrants to the U.S. using two cohorts of National Longitudinal Survey of Youth (NLSY79 and NLSY97). It shows that family background characteristics together with cognitive ability are important to children’s schooling attendance. It suggests that over the decades, children of immigrants as a group experienced a more significant improvement in educational attainment than children of natives. Preferences and endowments play different roles in explaining the improvements across ethnic groups. This essay also shows additional evidence of positive selection in immigrants similar to the ones discussed in Caponi (2011). Furthermore, educational support programs appear to have larger impacts on educational attainment, especially for Hispanics.

The second essay looks both educational attainment and outcomes in labor market. Specifically, it explains differences in education and wages between whites and ethnicity minorities in the U.S. using the recent cohort of National Longitudinal Survey of Youth (NLSY97). This essay reveals significant differences in how labor market rewards education and working experience based on ethnic origins. Furthermore, the decompositions of the observed differentials between whites and minorities show that the differences in educational attainment can largely be explained by differences in endowments, while behavioural differences play a more important role in explaining the ethnic wage gaps.

The third essay focuses on white children of immigrants in both Canada and the U.S. Using 1997 cohort of National Longitudinal Survey of Youth from the U.S. and the 2000 cohort of Youth in Transition Survey from Canada, I find that family background is closely related to educational attainment of white children of immigrants in both countries. Results from counter-factual simulations suggest that incentive-based educational reforms are effective in increasing overall educational attainment for both children of natives and children of immigrants. Furthermore, the desired dollar amount of these educational subsidies are smaller in Canada than in the U.S.